March 25, 2014 Newsletter

Dear Friends,

Tangents:

Gloria Steinem turns 80 years old today – hard to believe.  I read an interview with her in the New York Times on Sunday.  She is spending her 80^th birthday riding elephants in Botswana – isn’t that amazing!

Elton John’s birthday today and Aretha Franklin’s too.

Ode on the Spring

Lo! where the rosy-bosomed hours,
Fair Venus’ train, appear,
Disclose the long-expecting flowers,
And wake the purple year!
The Attic warbler-pours her throat,
Responsive to the cuckoo’s note,
The untaught harmony of spring:
While whispering pleasure as they fly,
Cool zephyrs through the clear blue sky
Their gathered fragrance fling…

-Thomas Gray

Photos of the day

A visitor photographs the cherry blossoms in Ueno Park in Tokyo. Tens of thousands of admirers are expected to show up at the park to enjoy the white and pink blossoms. Eugene Hoshiko/AP

Visitors look at a sound and light show as part of the exhibition ‘Klimt and Vienna, a Century of Gold and Colors’, projected on the walls of the ‘Carrieres de Lumieres’ site (Quarries of Lights) in Les Baux-de-Provence, France. Jean-Paul Pelissier/Reuters

Market Closes for March 25^th, 2014

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada
By Gerrit De Vynck

March 25 (Bloomberg) — Canadian stocks rose as raw- materials shares rallied with copper prices and U.S. data showed consumer confidence climbed to a six-year high.

Turquoise Hill Resources Ltd. rallied 3.5 percent as copper futures jumped 2 percent in New York. Agrium Inc. rose 1.8 percent after a report said the fertilizer company may consider selling assets. Legumex Walker Inc. dropped 9.8 percent after the bean and pea processor reported a quarterly loss.

The Standard & Poor’s/TSX Composite Index gained 20.94 points, or 0.2 percent, to 14,299.49 at 4 p.m. in Toronto. The gauge has risen 5 percent this year.

“Materials have rebounded from a really, really bad day so people are trying to look for value and pick your pockets of opportunity and put a little bit of money to work,” said Brian Huen, managing director at Red Sky Capital Management Ltd. in Toronto. He helps manage about C$225 million ($201 million).

U.S. consumer confidence unexpectedly climbed in March to the highest level in six years, propelled by improved optimism about the economy’s prospects. The report from the Conference Board overshadowed separate data showing American home sales dropped in February.

Materials stocks added 0.9 percent after dropping 2.8 percent yesterday. Copper advanced in New York after Anglo American Plc halted work at a mine in Chile, sparking concern supply might be disrupted.

Turquoise Hill climbed 3.5 percent to C$3.82. SouthGobi Resources Ltd., which is 56 percent-owned by Turquoise Hill, rebounded 25 percent to 66 Canadian cents after tumbling 27 percent yesterday when it said falling coal prices may force it to default on debt. SouthGobi is seeking financing to avoid a default.

Agrium increased 1.8 percent to C$106.62 after a Globe & Mail report said the fertilizer company may consider selling assets, including its phosphate business. Agrium mines potash, which is used as a root-strengthening crop nutrient.

Legumex Walker dropped 9.8 percent to C$4.49 as the bean and pea processor reported a quarterly loss of 44 Canadian cents a share after the markets closed yesterday. The Winnipeg, Manitoba-based company said it had to use trucks to gets some of its products to market because of a shortage of rail cars.

Copper Mining Mountain Corp. added 8.9 percent to C$2.20 after saying in a statement that construction was moving forward on a new secondary ore crusher at its mine in British Columbia.

US
By Lu Wang and Callie Bost

March 25 (Bloomberg) — U.S. stocks advanced for the first time in three days as commodity and health-care shares rallied and economic data showed consumer confidence at a six-year high.

International Business Machines Corp., Cisco Systems Inc. and Johnson & Johnson rallied more than 2.2 percent, leading gains in the Dow Jones Industrial Average. Health-care companies rose 0.8 percent as biotechnology stocks halted a four-day slump. Freeport-McMoRan Copper & Gold Inc. rose 1.5 percent as copper prices increased. Carnival Corp. slid 5 percent after it narrowed its full-year profit forecast.

The Standard & Poor’s 500 Index added 0.4 percent to 1,865.62 at 4 p.m. in New York. The Dow average increased 91.19 points, or 0.6 percent, to 16,367.88. The Russell 2000 Index was little changed.

“Things don’t look spectacular here, but they look OK,” Curtis Holden, a senior investment officer at Tanglewood Wealth Management in Houston, said by phone. The firm oversees about $800 million. “The U.S. economy seemed to have cooled off from the pace it’s on toward the end of last year. There may be a little relief recently that things may be stable here.”

Large companies led the market’s gain as investors opted for less volatile stocks. IBM, the world’s largest computer- services provider, advanced 3.6 percent to $195.04. Cisco, the world’s biggest maker of network routers and switches, gained 3.6 percent to $22.34. J&J, a health-care products company, rose 2.3 percent to $97.38.

The Chicago Board Options Exchange Volatility Index, a gauge for U.S. stock volatility also known as VIX, fell 7.1 percent to 14.02 today. About 6.6 billion shares changed hands on U.S. exchanges, in line with the three-month average.

Three rounds of bond purchases from the Federal Reserve have helped fuel economic growth, sending the S&P 500 surging as much as 178 percent from its 2009 low. Fed Chair Janet Yellen said on March 19 that the central bank’s stimulus program could end this fall and benchmark interest rates may rise about six months later.

Fed Bank of Philadelphia President Charles Plosser said in an interview on CNBC today that the central bank wants to get back to normal policy, and that he doesn’t think the Fed changed its position on a rate rise.

The Conference Board’s index of U.S. consumer confidence rose to 82.3 in March from 78.3 a month earlier, the New York- based private research group said today. The median forecast in a Bloomberg survey of 76 economists called for a reading of 78.5 this month.

Another report showed purchases of new homes in the U.S. fell in February to the lowest level in five months, a sign the industry may take time to pick up after inclement weather damped demand earlier in the year.

Residential real-estate prices climbed at a slower pace in the year through January than a month earlier. The S&P/Case- Shiller index of property values in 20 cities increased 13.2 percent from January 2013, the smallest gain since August, after rising 13.4 percent in the 12 months through December.

“There is no doubt that the market is discounting the first quarter,” Tom Wirth, a senior investment officer for Chemung Canal Trust Co. in Elmira, New York, said in a telephone interview. The firm oversees $1.8 billion. “They know the weather is going to materially impact first-quarter GDP. It’s just wait and see until we see if there is truly accelerating strength in the economy.”

Investors have added $8.4 billion to U.S. equity exchange- traded funds in the past five days and $1 billion to bond ETFs, data compiled by Bloomberg show. Financial stocks absorbed the most money among industry ETFs, taking in $1 billion during the past week.

Industrials rose 0.9 percent for the best performance in the S&P 500, as nine out of 10 groups advanced. Shares of energy and health care stocks climbed 0.8 percent. The Nasdaq Biotechnology Index added 0.1 percent, ending a four-day, 8.7 percent drop.

Raw-material producers in the S&P 500 rose 0.5 percent as a group. Copper rose the most in 15 weeks in New York on speculation that demand will improve as China, the world’s largest metals consumer, takes steps to bolster economic growth. Freeport-McMoRan, the largest publicly traded copper producer, climbed 1.5 percent to $32.08.

Walgreen Co. climbed 3.3 percent to $66.42. The owner of pharmacies said it plans to close 76 drugstores in the second half of fiscal 2014. Synergies from its Alliance Boots business will be higher than previously estimated, the company said.

Sonic Corp. rallied 11 percent to $23.23, the highest level since April 2008. The company’s second-quarter adjusted profit of 7 cents a share beat the average analyst projection of 6 cents.

McCormick & Co. advanced 5.5 percent to $71.20, the highest level since August. The maker of spices and other flavored products reported first-quarter profit and sales that exceeded analysts’ estimates.

Carnival declined 5 percent to $38.02. The world’s largest cruise line operator has been facing lower ticket prices and higher costs to attract customers hesitant about past incidents, including onboard illnesses and a fire on a Triumph cruise.

Have a wonderful evening everyone.

Be magnificent!

My country and your country,

my God and God – all that is the fragmentation of thought.

Krishnamurti, 1895-1986

As ever,

Carolann

Kindness is always fashionable.

-Amelia Barr, 1831-1919

Carolann Steinhoff, B.Sc., CFP®, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7